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Do you want to hire independent contractors in Brunei? If yes, know a few facts to make a decision.
Brunei Darussalam is a prosperous nation in Southeast Asia. Although its economic growth has seen a steep dip caused by the Asian financial crisis in 1997, the country continues to flourish as one of the fastest-growing economies. Courtesy of abundant gas and oil reserves, Brunei’s GDP per capita for 2025 is forecasted to amount around US $ 35,700.
What’s more, Brunei has a skilled workforce that plays a crucial role in its development. The country has a high literacy rate, indicating an educated workforce. The government of Brunei also places a strong emphasis on tertiary education to develop a skilled workforce across various fields. For instance, the Civil Service Institute in Brunei provides ongoing training and skill development for both employees and self-employed individuals to polish their skills.
Another great thing about the workforce in Brunei is that it is more affordable than in most other parts of the world. For instance, accomplished data scientists in Brunei usually make an average salary of BND 90,000 or US $66,613 per year. However, in the USA, entry-level data sciences make more, within the range of US $85,000 to $120,000 annually.
Brunei also has a strong English education system, which means that most independent contractors are fluent in the language. This helps facilitate smooth communication and collaboration with international clients.
Hiring independent contractors from Brunei may seem like a good decision. But where do you look for them, make payments, comply with laws, and ensure their relevance to your project? To find all the details, read this guide below.
What Are Independent Contractors in Brunei?
An independent contractor in Brunei is a self-employed professional. They don’t work under the control of an employer. Plus, they offer their services to a company or client on a contract basis.
The contractor is not categorized as an employee. This means that they are responsible for managing their own tax business operations. They have to take care of all these things themselves while delivering a special project or service to the client.
To conclude, an independent contractor operates as a separate entity under Brunei’s law system.
Differences Between Independent Contractors and Employees in Brunei
In Brunei, full-time employees are treated differently than independent contractors under local law. For instance, independent contractors don’t receive any coverage under the Employment Order 2009. Plus, they stay deprived of statutory benefits like health insurance or paid leave.
Additionally, independent contractors are hired through detailed contracts featuring a strong emphasis on the scope of work, payment terms, and misclassification recursions.
Take a look at some key differences in detail.
Control Over Work
Unlike an employee, an independent contractor has flexibility when it comes to their working hours. These are not set by anyone. The contractor is responsible for managing their own schedule and meeting deadlines accordingly, as promised in the contract.
Benefits
All employees in Brunei get statutory benefits. They get sick leaves, minimum wage, and paid holidays. Unfortunately, independent contractors are not provided with any of that. They work separately from an employer, so they don’t get to experience these benefits.
Contract Structure
Unlike an employee’s standard employment contract, an independent contractor has a service contract that is quite comprehensive. It clearly mentions the scope of work, details of all the deliverables, and payment terms for the project for which they are being hired.
Taxation
In the case of employees, employers deduct taxes directly from their workforce’s paychecks. However, that’s not the case when you hire an independent contractor. An independent contractor is responsible for filing and paying their own taxes. As an employer, you have no legal obligation to do that.
Negotiation Practices
Independent contractors in Brunei engage in several negotiation practices that are different from what employees follow. For instance, it is common for contractors to begin negotiations with a slightly higher rate than their target. This helps create lots of room for negotiation.
They also communicate the extra benefits they bring to a project, creating an impression of being better than employees. It is important to clearly document all agreed-upon terms in the final contract with the independent contractor to save your company from any mishap.
Considering these major benefits, it is important to classify an independent contractor correctly. You may face multiple fines, penalties, and legal action if you fail to do so.
The misclassification of independent contractors in Brunei is an act that defines the incorrect classification of a worker as an independent contractor. Many companies make this mistake to keep themselves safe from the hassle of paying benefits or taxes.
A misclassification like this can lead to penalties for the company if discovered. This is because Brunei’s labor law clearly separates an employee’s status from that of an independent contractor. The law features different rights and obligations for each.
To save yourself from all the unnecessary financial punishments, ensure that your contracts with independent contractors clearly feature the expected scope of work. It must highlight all the payment terms and other important aspects of the working relationship between you and the contractor.
Why Should You Hire Independent Contractors in Brunei?
Hiring independent contractors in Brunei can help your business in more ways than you can imagine. Here are a few reasons to welcome them onboard.
Independent Contractors Save Costs
When you hire independent contractors, you save a lot on administration expenses compared to when you welcome employees to your team. For instance, with independent contractors, you don’t have to pay any paid leave or health insurance.
There are also no operational costs related to managing these contractors as they don’t need office space. Plus, contractors look after their equipment requirements themselves.
They Work as Skilled Labor
The great thing about independent contractors is that they have industry-specific knowledge. Their skills are specialized, adding value to your project.
Additionally, some independent contractors may have already worked with multiple international clients, so they might have more experience than employees in Brunei.
They Facilitate Quick Onboarding
The onboarding process with independent contractors is usually simple and short. This makes them top options for quick labor.
Independent Contractors Have Work Flexibility
Independent contractors in Brunei work flexibly as they set their own schedules and timelines. Plus, they manage their schedules themselves, saving you the hassle of monitoring their productivity every time.
They Have Thorough Knowledge of Brunei’s Local Market
Another important reason to onboard independent contractors is that they are well aware of Brunei’s local market. They understand the laws and regulations, saving you the hassle of ensuring their compliance. Besides, they are the perfect candidates in Brunei to offer you better insights and support your business growth in the region.
Brunei’s Labor Law’s Considerations to Determine the Status of a Worker
Here are some labor law considerations to take care of when hiring independent contractors in Brunei.
Service Contracts
The law mentions some specific components of a service contract with an independent contractor to avoid any misclassification. A service contract with an independent contractor must feature the following:
- Scope of Work: Deliverable, scope of project, and timelines
- Payment Terms: Payment schedule, process of invoicing, penalties on late payments
- Termination: Procedures for contract termination
- Confidentiality: Clauses that protect the sensitive information of both parties
The contract should also mention the ownership of the intellectual property. In the absence of a clause, the person who creates the work automatically becomes the first owner of the work.
However, if the contract classifies the work as “made for hire,” your company might be considered the author. This is common in situations where the creation made by the independent contractor falls within the scope of their employment.
Benefits
In Brunei, all employees get the benefit of experiencing a maximum number of 44 hours in a week. The law states that no employee should be made to work more than eight hours in a day at a normal wage rate.
Employees who work overtime are paid at 150% of the employee’s standard pay. It isn’t permissible to make an employee work more than 72 hours of overtime in a month.
However, there isn’t any similar law for independent contractors. Independent contractors have to set their own timelines and working schedule. They can work for as many hours as they want.
Similarly, as per the labor law, employees in Brunei receive almost 12 days of paid leave after a year of service. Additionally, pregnant women get two weeks of unpaid leave before giving birth and around 13 weeks of paid leave after giving birth.
But an independent contractor doesn’t get these benefits from your company. There is no concept of paid leave in such a contract until a company specifies it as part of its terms and conditions.
It is also important to note that the Labor Department in Brunei has issued a phased rollout of minimum wage under the Employment (Minimum Wage) Order 2023. So, as of July 2023, the minimum wage for full-time employees is BND500 or US $365.
However, this rule doesn’t apply to independent contractors. They are paid at competitive rates, according to their specialty, and according to the job’s demand.
Most independent contractors in Brunei are either paid:
- A fixed project fee that is always decided before the work begins. The price is usually based on the scope of work, deadlines, and milestones.
- Or a Retainer, which is a set amount that is paid regularly. Although it is a monthly payment, its frequency can still be negotiated in the contract.
Tax and Insurance
In Brunei, independent contractors are treated as self-employed professionals for tax purposes.
As per the law, all self-employed individuals who have a business income of more than BND$2,000 (approx. USD$1,460) in a tax year must register for income tax. They should do their registration with the Brunei Darussalam Revenue Authority (BDRA).
In addition to that, independent contractors working in Brunei must file their tax returns with the BDRA by the 30th of September following the tax year. They can either make these tax payments online or at designated collection centers.
When it comes to social security, Brunei Darussalam does not have a proper scheme for self-employed professions. However, there is a voluntary SESS program that offers retirement benefits. So, if your independent contractor is willing to enroll in SESS, they can contact the Ministry of Finance and Economy to be a part of it.
How to Pay an Independent Contractor in Brunei
After you have hired an independent contractor, you must make sure to pay them on a timely basis to keep them motivated for the project and also strengthen your relationship with them. The good news is that there are multiple ways you can pay independent contractors in Brunei.
International Direct Bank Transfers
Make sure to take all the bank account details of your hired independent contractors to transfer their pay directly in Brunei Dollars. Bank transfers are one of the most convenient and easiest ways to send money to the receiver.
Online Platforms
If the independent contractor has access to online platforms like PayPal or Wise, you can choose this method as well. Again, this is a simple method and doesn’t require much external assistance.
Cryptocurrency
This is a less common method, but you can use it as well. Instead of paying your independent contractor in Brunei with traditional money, you can send them funds in cryptocurrency.
This payment method is often considered quick as it doesn’t involve going through a bank or third party. Plus, it allows independent contractors to get their wages instantly. There is also no transfer fee involved, which proves helpful when making payments internationally.
Hiring Platforms
There are several platforms like Horizons, Remote, and Deel that not only hire independent contractors for you but also ensure their payment without bothering you at all. You can take their EOR services to manage the payment of independent contractors seamlessly.
How to Find the Best Independent Contractor in Brunei
If you think your project requires more independent contractors than employees, you must hunt for them to get access to an exceptional pool of talent in Brunei. However, you must consider a few factors before signing them with your company.
Expertise and Experience
Brunei’s workforce is quite skilled, but not every freelancer may have adequate work experience to offer you their skills. Therefore, ensure to go through the portfolios and certifications of each shortlisted contractor to know whether they can help you achieve success in the project. You may also conduct detailed interviews to know their knowledge and expertise.
Charges
Before you hire an independent contractor, make sure to understand their preferred way to receive their payments. Plus, evaluate their charges to know whether you can pay them easily from your budget allocated for the project. Brunei generally has affordable labor.
So, you may find many independent contractors in Brunei charging less than professionals working in the USA or Europe.
Reputation
Evaluate the reputation of the independent contractor before you invite them as a part of your company. You can communicate with the people who may have already worked with the contractors to know their views. Certain online reviews may also help you understand the candidate’s overall reputation.
Search Multiple Platforms
To find the best independent contractor, don’t rely on only one platform. Search multiple avenues like Facebook, LinkedIn, Upwork, and Fiverr to find talent that can help you achieve success.
When looking for a contractor, make sure to prepare a detailed job posting with a description of work to attract candidates who can actually add value to your company.
Contact Recruitment Agencies or Global Payroll Services
If you can’t do the search yourself, you can contact recruitment agencies to find you the best independent contractors in Brunei. There are multiple agencies that have teams to make this hunt easy for you.
Alternatively, you can also get help from global payroll services, which do much more than pay your independent contractors or employees. They also help you hire the best workforce and onboard them conveniently so they can start working on the project immediately.
How to Convert an Independent Contractor to an Employee
Suppose you want to make an independent contractor a full-time employee of your company. In that case, you should first evaluate if the nature of the contractor’s work allows them to be an employee. If it does, you can negotiate an employment contract with them outlining their benefits, wages, working hours, and tax implications.
Additionally, you must adhere to all necessary legal requirements when doing so. This can be achieved by setting up a local entity in Brunei or partnering with an Employer of Record (EOR) service to handle all the crucial employment formalities.
Once you have successfully converted an independent contractor to an employee, ensure to complete all the necessary paperwork to formally onboard them on your team.
Top Four Independent Contractor Providers in Brunei
Here is a list of top independent contractor providers that help you create a strong workforce for your company.
Remote People
Remote People provides contractor hiring services in Brunei, enabling companies to engage local talent without establishing a legal entity.
The service covers contract compliance under Brunei labor regulations, management of tax obligations, and support for multi-currency payments such as AMD, EUR, and USD. Onboarding is streamlined, giving employers the assurance that payroll and legal requirements are fully managed.
Globalization Partners
Globalization Partners helps ease the hiring, onboarding, and payment of independent contractors in Brunei. Globalization Partners is known for its extensive experience and strong reputation in handling companies like yours in various parts of the world.
Plus, the platform is run by experienced teams who ensure to save you from any sort of misclassification of employees and independent contractors.
Deel
Another leading independent contractor provider in Brunei is Deel. The company is known for providing you with many services. It has PEO and EOR teams to make you grow easily. Deel works in more than 150 countries and supports contractors and employees equally.
Velocity Global
Velocity Global is another global platform that helps you locate skilled independent contractors in Brunei. From recruiting them to ensuring their payment, Velocity Global takes care of all the aspects. The platform currently works in over 185 countries and facilitates quick onboarding of your new team members.
Independent Contractors in Brunei for Your Company’s Growth
Brunei may be a small country, but its workforce has the best talent to elevate your project’s performance. Plus, independent contractors in Brunei demand fewer charges than those working in most other parts of the world, proving to be cost-effective.
But how do you find these contractors in Brunei?
Here is an easy way! Simply connect with us at Remote People to help you hire and onboard the best independent contractors in Brunei.
We have an experienced team that can help you find the best talent by reducing your recruitment costs by 60%. Want to try us? Just visit our website today to find the best contractors for your upcoming project.
Frequently Asked Questions
Independent contractors are cost-effective labor. They are also flexible and are responsible for paying their own taxes. Also, they bring local insights that help companies grow.
It depends on the scope of the project, their knowledge, experience, and overall reputation with other global contractors. The nature of the project also affects the total amount they make.
You should consider their knowledge, work experience, and reputation. You must look into client reviews to evaluate these factors.
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